Last updated: 23 Febuary 2018
Operation of the Margin
You will be required to pre-collateralise your deliverable FX trading line at an amount to be agreed with us. All margin liabilities for trades executed by you or your clients will be applied against the margin account. Our services cannot commence until the margin account has been funded into an account designated by us. If margin is not available in the margin account to cover the margin requirement, then the trade will not be executed.
All open trades executed by you or your clients will be netted to give the Net Open Position (NOP) exposure per currency pair (resolved into GBP).
Mark to Market
Your clients’ open positions will be marked to market giving rise to a Net Open Equity (NOE) adjustment (resolved to GBP).
At the time of a trade being executed by one of your clients, the margin requirement for the trade will be calculated as per the table below:
|FX Product||Margin Requirement|
|TOD, TOM, SPOT||3% of consideration value|
|Forwards up to 1 month||3% of consideration value|
|Forwards 1-6 months||5% of consideration value|
|Forwards 6-12 months||10% of consideration value|
The Margin Ratio (MR) is calculated as follows: MR = margin deposit / (NOP + NOE).
In the event that your MR (inclusive of all of you and your clients transactions ) falls to 0.5%, we will call you for additional margin to take the MR back to a minimum of 3%, and you will have a maximum of 1 business day in which to pay this additional margin.
If no funds are posted by you within 1 business day (or proof of funds being sent is not provided by you), we will automatically close out your and your clients’ open trades so as to return the MR to a minimum of 3.0%. We have the right to close out the trades of our choice.
If at any time, the MR diminishes to 0.1%, we will automatically close out your and your clients’ open trades so as to return the MR to a minimum of 3.0%.We have total discretion on what trades are closed; however, we will make reasonable efforts to contact you before close out of any trades.
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